CSC lands Groundbreaker deal

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A joint venture by Computer Sciences Corp. snagged the $2 billion Groundbreaker outsourcing contract from the National Security Agency.

The contract is expected to help NSA, an intelligence-gathering agency with perhaps more supercomputing power than any organization in the world, to regain its technological edge in the rapidly changing Information Age.

Groundbreaker is being touted as a major acquisition reform effort for the once super-secret intelligence agency, and it may break ground for other intelligence agencies as well.

"As an agency in transition, NSA continues to address the technology explosion of the past decade by leveraging the expertise of the commercial marketplace through an aggressive reformed acquisition strategy," agency officials stated in an announcement July 31.

CSC went into the competition as the heavy favorite, competing against teams led by AT&T and OAO Corp. But CSC also was considered the favorite before the $6.9 billion Navy Marine Corps Intranet program was awarded last year and surprised the business world by losing that contract to Electronic Data Systems Corp.

Before the contract was announced, Tom Meagher, vice president of equity research at BB&T Capital Markets, Vienna, Va., said, "I would be stunned if [the National Security Agency] chose anybody else but CSC. This is a must-win for CSC. They've really gone out of their way to be competitive, and if they lose, it's their own fault.

Others also described the contract as a "must-win" for CSC if the company is to re-establish itself as a major player in the federal outsourcing market.

The Groundbreaker contract will begin in November, two months ahead of the original schedule, according to the agency's written announcement. The next step, said CSC spokesman Jamie Sullivan, is to work out a transition plan with NSA.

"We are finalizing our transition plan and completing our training requirements. We're also preparing to assume responsibility contracted to us under the Groundbreaker program," Sullivan said.

The CSC team, known as Eagle Alliance, will assume responsibility for 750 employees and will modernize the agency's nonintelligence-gathering information technology infrastructure. The products and services to be provided include secure and nonsecure telephony services, distributed computer services, and enterprise and security management.